LATEST THINKING

Retirement agencies: Get more than a toe in the big data pool

By diving deeper into big data, public retirement systems can get to outcomes.

Overview

Every public retirement agency is required to maintain decades of data about each member. With nearly 20 million members receiving a public employment benefit, that’s a treasure trove of data that retirement agencies are sitting on 1. Are agencies using this data to be more insight-driven?

Accenture’s North America Pensions survey included interviews of 100 decision makers and C-suite executives at American national, state and city public retirement agencies to understand general attitudes toward data analytics.

The findings reveal that many retirement agencies are using analytics to some degree, but they aren’t fully diving in to take advantage of the benefits. In fact, 92 percent believe their organization would benefit from doing more with data analytics. And 80 percent believe data analytics can help public retirement systems meet the goal of providing appropriate benefits to members. So what’s stopping agencies from taking the plunge?

Background

Accenture research shows that retirement agencies are dabbling in analytics, but they’re not diving in to take full advantage of the potential insights that are locked up in their data. Nearly 9 in 10 say their organization uses some degree of data analytics already, however, 92 percent believe their organization would benefit from doing more with data analytics. Accenture’s North America Pensions survey included interviews of 100 decision makers and C-suite executives at American national, state and city public retirement agencies to understand general attitudes toward data analytics.

The research revealed a high level of interest, but the level of expertise did not align. Seventy-four percent of those surveyed believe data analytics is here to stay, and retirement systems need to start developing competency in it. And 80 percent believe data analytics can help public retirement systems meet the goal of providing appropriate benefits to members. However, a majority (66 percent) say they would like for their organization to use data analytics more, but don’t understand it enough to do so.

Analysis

There are business benefits and mission-critical insights waiting to be unearthed from retirement agencies’ data. Some are testing the waters. For example, the Employees Retirement System of Texas (ERS) is using its data to be more insight-driven. Through a business intelligence framework, ERS is analyzing large amounts of data for key performance indicators and they are drilling down to more granular information to generate quick reports and to conduct advanced analysis and forecasting. It’s up to retirement agencies to decide how far to plunge into the big data pool to get these kinds of outcomes.

Many public retirement agencies are getting a toe in the big data pool. Yet vast opportunity remains for retirement agencies to dive deeper with their data to do more for the mission—and the members. Some agencies may feel adrift in what seems to be an unmanageable sea of big data. By slowly wading through big data to be more insight-driven, agencies will quickly get to a shore of better outcomes.

Recommendations

Wade in to build legislative leverage

Retirement systems can use their data to get in front of legislature and proactively lead the conversations that will ultimately drive policies. Or, agencies can better prepare for the effects of legislation. For instance, the Public Employees’ Pension Reform Act of 2013 (PEPRA) eliminated the Additional Retirement Service Credit.3 Using analytics, the California public pensions agency CalPERS can calculate how this legislation will impact its member contributions and benefits moving forward.

Swim toward system sustainability

Achieving adequate returns from investments is a key area of focus for pensions administrators (according to Accenture’s survey, 95 percent say this is very important). Agencies spend ample time managing their investment pool to get the right returns. Analytics can offer a fact-based picture of investments that can be used to inform decisions across key areas.

The majority of survey respondents believe that data analytics can be useful in:

Analyzing portfolio performance statistics (69 percent)

Analyzing risk in portfolio (69 percent)

Analyzing performance of various portfolio components (66 percent)

Analyzing comparative portfolio components (62 percent)

Plunge in to protect your state’s economy

States miss out on economic development opportunities when retirees move elsewhere to live their retirement years. For example, states pay out billions in retirement benefits, yet a large percentage of this money goes to a different state’s economy. Some retirees take their nest egg and flock to states, such as Pennsylvania and Mississippi, where pension income is exempt; or where a portion of pensions income is exempt, such as in Arkansas, Colorado, Delaware and New York.

Infographic

Podcast

Listen to this podcast to learn how public retirement systems can get to outcomes by diving deeper into big data.

The Accenture North America Pensions Survey 2013 of 100 decision makers and C-suite executives reveals the general attitudes towards data analytics in American national, state and local public retirement agencies. Listen to Owen Davies, Managing Director of Accenture Pension Services reveal how Retirement Agencies can get more than a toe in the big data pool by diving deeper into their analytics to reveal the treasure trove of insights they are sitting on.

Select your location

We were unable to find a match for "$searchstring." Try searching again by using different or more general keywords and check for spelling errors.

RECOMMENDED CONTENT

FILTER RESULTS

FILTER RESULTS

Connect with our Talent Community

Personalize your Accenture Career search and receive tailored news, insights and job alerts. Join our Talent Connection to learn more about the challenging and rewarding career opportunities offered by Accenture.